1099 taxes, before they surprise you.
Work for yourself? Nobody withholds anything, so the whole bill lands on you. Here's the number to set aside every quarter.
Two federal taxes hit 1099 income: self-employment tax (15.3% on 92.35% of profit) and regular income tax on what's left after your deductions.
Two taxes, no withholding
A W-2 paycheck has tax taken out before you see it. 1099 money doesn't. The IRS still wants it during the year, in four estimated payments, and charges an underpayment penalty if you wait until April.
The bill has two parts:
- Self-employment tax — Social Security and Medicare, both halves. Social Security stops at $184,500 of earnings in 2026.
- Federal income tax — the normal brackets, on profit minus half your SE tax, the standard deduction ($16,100 single in 2026) and the QBI deduction.
The simple habit
Every time a client pays you, move the calculator's percentage into a separate savings account. When a quarterly due date comes around, the money is already sitting there.
Questions
How much should I set aside for 1099 taxes?
Use the quarterly number above. For a single filer with no other income, federal tax on $60,000 of profit is roughly a fifth of it. Add your state's income tax on top unless you live in a no-tax state.
Why is self-employment tax 15.3%?
As your own employer you pay both halves of Social Security and Medicare: 12.4% Social Security (up to the wage cap) plus 2.9% Medicare, on 92.35% of your net profit.
What is the QBI deduction?
The qualified business income deduction lets most freelancers take 20% of their business profit off their taxable income. In 2026 it's in full below $201,750 of taxable income ($403,500 married filing jointly), then shrinks if you have no employees.
Can I deduct part of my self-employment tax?
Yes. Half of the 15.3% comes off your income before income tax is figured. The calculator already does this.
When are quarterly payments due?
For the 2026 tax year: April 15, June 15 and September 15 of 2026, and January 15 of 2027. Pay through IRS Direct Pay or EFTPS.
I also have a W-2 job. Does this still work?
Not exactly. Your W-2 pay fills the lower tax brackets first, so your 1099 income gets taxed at a higher rate. Treat this number as a floor.